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Supply Chain Collaboration and Trust in the Philippines

Ma. Gloria V. TalaveraUniversity of the Philippines

This paper presents the relationship between supply chain collaboration and trust, two important concepts in supply chain management. The transaction costs and stakeholder theories were used as frameworks in analyzing supply chain collaboration and trust. These constructs were developed through literature review and in consultation with industry experts. Factor analysis was conducted to identify the underlying dimensions of these constructs while correlation analysis was done to determine their association. A total of 57 companies from Philippine manufacturing and service sectors participated in the study. From the factor analyses, two important dimensions of supply chain collaboration emerged: (1) joint planning and decision making and (2) information sharing. The trust construct, on the other hand, revealed two important perspectives: (1) relational perspective (the long-term relationship of the supply chain partners and their familiarity with their respective organizations) and (2) risk perspective (the propensity and willingness to take risk under conditions of uncertainty). Correlation analyses reveal that information sharing, a measure of supply chain collaboration, is significantly correlated with the relational perspective of trust. The study contributes to the supply chain management (SCM) literature by providing comprehensive and pragmatic definitions of supply chain collaboration and trust. It also provides practitioners with a listing of SCM strategies that they can employ to achieve better collaboration.